Sierra Leone president eyes new term amid mining boom

TILORMA, Sierra Leone (Reuters) - When the European Union's chief election observer Richard Howitt asked people in this remote village last month if they had concerns about Sierra Leone's looming presidential poll, he got a sobering response: what is voting?

The question from one of the villagers in the gold and diamond mining district of Kenema underscored the challenges facing this West African country ahead of Saturday's elections, which will become the latest test of democracy in a region notorious for flawed polls, civil wars, and coups.

Incumbent President Ernest Bai Koroma, a former insurance executive who came to power in 2007 in elections generally considered free and fair, will face off against former junta leader Julius Maada Bio.

At stake is a chance to oversee hundreds of millions of dollars of recent investment in the country's rich, but mostly untapped, mineral resources.

If managed well, cash generated by Sierra Leone's burgeoning mining sector could transform a country that still bears the scars of a 1991-2002 civil war into one of the world's fastest growing economies, and help lift many of its 5.5 million citizens out of crippling poverty.

But fears of corruption, or a return to instability, remain and presidential hopefuls are seeking to convince voters they are best placed to root out graft, bridge ethnic divisions and ensure the country gets its fair share from mining deals.

"We are expecting development for the country, like good roads, jobs, light," Henry Tommy, a 35-year-old self-employed stone mason in Freetown said. "Now this country is a peaceful country, we don't want no fighting no more."

Francis Kumah, the IMF's resident representative, said the start up of iron ore shipments by British firms African Minerals and London Mining could fuel 20 percent growth in Sierra Leone this year, and yield royalty revenues of between $125 and $250 million per year by the end of the next administration.

In a country whose entire national budget currently hovers around $500 million, that is a lot to play for.

Sierra Leone also holds rich deposits of diamonds - which helped fuel the civil war - gold, and other minerals. Its election follows polls in regional neighbor Ivory Coast, which sparked a civil war, and Guinea Bissau, which triggered a coup.

ETHNIC LINES

Koroma, viewed as the favorite in the election, has scored points for infrastructure projects during his first term, with new roads appearing in Freetown and beyond, and the completion of the first stage of a long-delayed hydropower dam.

International companies have also arrived with investments in agriculture - including a $1.2 billion rice and rubber project inked earlier this year. The World Bank said foreign direct investment in the first eight years since the end of the civil war topped a half billion dollars.

"The fact that the direct foreign investment has substantially increased is a reflection of the confidence people are having in the country," Koroma told reporters in Freetown earlier this week.

However, Koroma's government has also taken flak for alleged softness on corruption and for signing opaque deals.

The country's Anti-Corruption Agency has not sent a single person to jail during Koroma's term, his vice president and running mate was investigated and later cleared of graft in timber deals, and neither African Minerals nor London Mining's arrangements conform to Sierra Leone's mining code.

Koroma's challenger Bio, a member of the military government that held power in Sierra Leone for four wartime years and who served briefly as head of state in 1996, has attacked Koroma's record and promised to review all existing deals and the mining code if elected.

"President Koroma, when he won the election, was not as popular as I am today," Bio told Reuters after a rally in Moyamba in the southern province of Sierra Leone. "My name is a household name in the country."

Political allegiance in Sierra Leone, however, is largely drawn on ethnic lines. Koroma's All People's Congress Party draws its support from the Temne and Limba tribes of the north, while Bio's SLPP is rooted in the Mende of the south and east.

The strength of ethnic ties means it will be hard for either candidate to take the 55 percent required to win outright in the first round, meaning a run-off election is likely. But the powers of incumbency make Koroma the favorite.

Preparations for the poll have been largely peaceful, although the U.S.-based Carter Center election observer mission said on November 1 it was concerned by lackluster voter education efforts at ward level and "troubling cases of intimidation of women candidates during the parties' primary and nomination periods."

Koroma's government has said it will deploy 1,500 soldiers to help police keep order on election day in case of any unrest.